Mr Jeffrey Vassallo v Easitag Pty Ltd
[2021] FWC 5919
•14 SEPTEMBER 2021
| [2021] FWC 5919 |
| FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.603 - Application to vary or revoke a FWC decision
Mr Jeffrey Vassallo
v
Easitag Pty Ltd
(C2020/6254)
COMMISSIONER CIRKOVIC | MELBOURNE, 14 SEPTEMBER 2021 |
Application for costs - section 611 - previous decision to award indemnity costs on the basis that application made was vexatious, without reasonable cause and had no reasonable prospect of success - assessment of indemnity costs- order made.
[1] This decision concerns an application by Easitag Pty Ltd (Easitag) made under s 611 of the Fair Work Act 2009 (Act) for a costs order against Mr Jeffrey Vassallo. This decision follows my earlier decision of 17 June 2021 in which I determined to award Easitag costs against Mr Vassallo on an indemnity basis. 1
[2] This matter has a lengthy history. For the purposes of this decision, it is sufficient to refer to what was outlined by the Full Bench of the Commission in a decision made on 26 July 2021 (the 2021 appeal costs decision):
“In 2017, Mr Vassallo brought a dispute to the Commission under s 739 of the Act and the dispute resolution procedure in the Electrical, Electronic and Communications Contracting Award 2010 (Award), in which he contended that he should properly be classified at level 10 of the Award. On 15 November 2017, the Commissioner rejected Mr Vassallo’s claim and determined that he was properly to be classified at level 4 of the Award (2017 decision). Mr Vassallo appealed. In a decision dated 24 January 2018, a Full Bench of the Commission refused permission to appeal (2018 appeal decision). Mr Vassallo then commenced proceedings in the Federal Court, in which he contended that he had been underpaid as a result of not having been correctly classified under the Award. On 23 June 2020, the court dismissed the application. Mr Vassallo also applied to have the President of the Commission refer questions of law to the Court pursuant to s 608 of the Act. The application was denied.” 2
[3] Mr Vassallo thereafter made an application under s 603 of the Act (the s 603 application), in which he asked me to vary or revoke the 2017 decision. I concluded in my decision of 12 January 2021 (the s 603 decision) that the majority of Mr Vassallo’s submissions sought to reagitate matters that were the subject of the 2017 decision, and that the s 603 application was an abuse of process, groundless and vexatious. I dismissed the s 603 application under s 587(1)(b) of the Act. 3 Mr Vassallo appealed. In a decision made on 23 March 2021, the Full Bench of the Commission, refused Mr Vassallo permission to appeal (2021 appeal decision).4 Easitag then sought its costs in relation to Mr Vassallo’s 2021 appeal on an indemnity basis, or alternatively on a party-party basis. In the 2021 appeal costs decision, the Full Bench found Mr Vassallo’s appeal to be a “plainly an unmeritorious one”5 and ordered Mr Vassallo to pay costs of $1,745.00. 6
[4] On 17 June 2021, I issued a decision (the 2021 costs decision) ordering indemnity costs against Mr Vassallo in respect of the s 603 application and directed the parties to file materials in respect of the quantum of costs to be awarded.
[5] On 4 July 2021, Mr Vassallo lodged an appeal against the 2021 costs decision and sought a stay pending the hearing and determination of the appeal. Vice President Hatcher dismissed the stay application, 7 stating he was “not persuaded that Mr Vassallo’s appeal amounts to an arguable case with some reasonable prospects of success.”8 Mr Vassallo discontinued that appeal on 16 July 2021.
[6] Pursuant to my directions at paragraph [48] of the 2021 costs decision, Easitag filed a Bill of Costs in taxable form on 1 July 2021. 9 This is produced at the end of this decision and is marked “Attachment A”.
[7] I issued further directions on 21 July 2021, directing the parties to confer with a view to reaching agreement as to the question of costs, offering them a Member assisted conciliation conference. I requested that in the event the parties could not agree, they advise my Chambers within 14 days, whereupon Easitag was to lodge an itemised assessment for the purpose of taxing the costs.
[8] In response to the above directions, Easitag re-submitted the itemised bill as well correspondence dated 28 July 2021 in which they advised Mr Vassallo that if he did not comply with the costs order made pursuant to the 2021 appeal costs decision, and any costs awarded in this decision, they reserved the right to commence proceedings in the Federal Circuit Court.
[9] Mr Vassallo submitted his response to Easitag’s itemised bill of costs on 12 August 2021. Mr Vassallo’s submissions are reproduced below:
“• On 14 October 2020 and pursuant to s 596 of the Fair Work Act 2009 and rules 11, 12 and 12A of the Fair Work Commission Rules 2013, lawyers for the Respondent filed a Form F53 for matter number C2020/6254.
• President of the Fair Work Commission Justice Ross dismissed and rejected this application and denied the Respondent legal representation for the matter number applied for.
• It is noted that this was the only time that the Respondent filed to the Fair Work Commission a F53 for this matter. A prescribed form that must be submitted according to the rules and the Act.
• At the FWC directions hearing for the s 603 Application, the Respondent raised an objection to the FWC as to its jurisdiction to deal with the s 603 Application
• The FWC directed parties to file submissions as to the Fair Work Commission’s jurisdiction.
• The FWC determined that it did in fact have jurisdiction and the Respondent’s objection failed.
• The FWC directed both parties to file brief submissions as to the merits of the Application.
• The Applicant filed 6 pages of submissions and the Respondent 4 pages.
• The hearing was concluded in less than one hour.
• The Respondent filed a costs application in excess of $7,000 for the FWCFB Appeal matter. The Full Bench awarded the Respondent $1745.00 in costs. The submissions filed for the FWCFB Appeal hearing far exceeded that of the Brief Submissions Application and hearing. The FWCFB Appeal hearing was also concluded in less than one hour. It can also be noted that the Respondent did comply with s596 of the Act and rules 11, 12 and 12A of the Fair Work Commission Rules 2013 and filed a F53 prior to the FWCFB Appeal proceedings.
• It seems that the Respondent has again over inflated the itemised bill of costs in this matter.
• It seems that the Respondent is also seeking costs for its failed objection as to the jurisdiction of the FWC to deal with a s 603 application. The Applicant feels that to award costs for a failed objection is unfair and unjust.
• In closing, the Respondent did not comply with the FWC rules and the Act and as such the Applicant is of the opinion that the Respondent is not entitled to any costs under the Act.
• If the FWC deems that the Respondent is entitled to costs under the Act and the FWC Rules, then an order of an amount similar to that made by the FWCFB would seem comparative.” 10
Relevant legislation and principles
[10] Section 611 of the Act provides as follows:
“611 Costs
(1) A person must bear the person’s own costs in relation to a matter before the FWC.
(2) However, the FWC may order a person (the first person) to bear some or all of the costs of another person in relation to an application to the FWC if:
(a) the FWC is satisfied that the first person made the application, or the first person responded to the application, vexatiously or without reasonable cause; or
(b) the FWC is satisfied that it should have been reasonably apparent to the first person that the first person’s application, or the first person’s response to the application, had no reasonable prospect of success.”
[11] The Full Bench in Hansen v Calvary Health Care 11confirmed the Commission’s power to order indemnity costs and said in relation to s 611 generally:
“[15] It is trite to observe that the statutory and policy imperative underpinning a costs application under the Act, is that a person in a matter before the Commission must bear their own costs. So much is plainly obvious by the precise and unambiguous language of s 611(1).
[16] However, the statutory scheme sets out the relatively circumscribed circumstances in which an order for costs might be found by the Commission to be appropriate in a particular case. It includes the exercise of discretionary power where the Commission is satisfied that one, or more of the circumstances set out in s 611(2), has been established. If such circumstances are established, the Commission, in the broad exercise of its discretion, may make an order that a person/s bear some, or all of the costs of another person, in relation to the application, including on an indemnity basis, or decline to make any order at all.” 12
[12] More recently, the Full Bench in the 2021 appeal costs decision stated:
“We note that Schedule 3.1 is prescribed for the purposes of awarding costs in relation to applications under s 365 (see ss 376 and 377A), Part 3-2 (see ss 400A to 403) and s 773 (see ss 779A to 781A). The amounts that may be ordered in costs applications of these particular kinds is limited by ss 377A(2), 403(2), and 781A(2). The application for costs in the present matter is unaffected by these provisions or Schedule 3.1. Rather, the jurisdiction of the Commission under s 611 having been established, there is a discretion to order ‘some or all’ of the relevant costs, taking into account what is fair and just (s 577(a)).” 13
[13] These Full Bench decisions establish:
a) In the broad exercise of my discretion to award costs, I may make an order that Mr Vassallo bear some, or all of the costs of Easitag on an indemnity basis; and
b) In this matter, the quantum of costs I may award is not limited by Schedule 3.1 or ss 377A(2), 403(2), and 781A(2) of the Act and I have the discretion to order some or all of the relevant costs, taking into account what is fair and just (s 577(a) of the Act).
Consideration
[14] As I determined in the 2021 costs decision, I am satisfied that Mr Vassallo’s s 603 application was made vexatiously and had no reasonable prospects of success and that the discretion to make an order for indemnity costs is enlivened and I am prepared to exercise my discretion and order indemnity costs against Mr Vassallo. He was unsuccessful at first instance and again on appeal, and when he made the s 603 application, there had been no change in the factual circumstances. At least from 24 August 2020, when my chambers forwarded to Mr Vassallo a copy of a letter dated 19 August 2020 from Easitag’s solicitors to Mr Vassallo’s former solicitors, Mr Vassallo was on notice of the basis upon which Easitag asserted the s 603 application was vexatious and baseless. The assertions of Easitag were encapsulated in my conclusion that the s 603 application was nothing more than an attempt to re-litigate claims previously determined and not disturbed on appeal. It was communicated by Easitag at that time that an application for costs would be made on an indemnity basis and Mr Vassallo was invited to discontinue the s 603 application.
[15] The costs incurred by Easitag included professional costs for the time spent by Easitag’s solicitor in dealing with the s 603 application and the disbursements associated with the engagement of Counsel from 24 August 2020. Easitag’s Bill of Costs outlines 43 items 14 claimed in respect of professional costs totalling $9,029.00. Each item is based on an item contained within Schedule 3.1 of the Fair Work Regulations 2009 (the Regulations) (see Attachment A) and the quantum for each item claimed reflects that which is outlined in the Schedule, save for those items which vest in the Commission a discretion. There are also disbursements claimed relating to the fees of Counsel. These are outlined in four separate invoices from Counsel’s Clerk totalling $10,489.01 exclusive of GST. The combined amount claimed in the Bill of Costs for costs and disbursements is $19,518.01.
[16] It remains necessary for me to be satisfied that the costs claimed were reasonably incurred. Mr Vassallo’s submissions referred to above repeat much of his earlier submissions which were dealt with in my 2021 costs decision. In addressing the quantum of the costs claimed the submissions of Mr Vassallo are, in essence, that the costs are “inflated”.
[17] Mr Vassallo also submits the costs, if any to be ordered in this matter, should be commensurate to those in the 2021 appeal costs decision. I reject this submission. The Bill of Costs before me relates to work undertaken by Easitag in defending the s 603 application. This was more substantial than the work involved in responding to Mr Vassallo’s subsequent appeal, a task characterised by the Full Bench in the 2021 appeal costs decision as requiring “relatively little work … to respond effectively” 15. The parties submitted a significant amount of material in response to the initial directions of 27 August 2021 with respect to jurisdiction, including submissions consisting of 8 pages from Easitag along with a document list of 424 pages and a list of authorities consisting of 245 pages. Mr Vassallo responded by filing extensive material (almost 1,000 pages) including submissions as to jurisdiction of 13 pages, a Witness Statement consisting of 4 pages and a document containing 975 pages of annexures. In response to the directions of 22 October 2021 with respect to the merits of the application, Mr Vassallo filed additional material including 13 pages of submissions and in excess of 500 pages of supporting documents to which Easitag responded with its own submissions in reply consisting of 4 pages. In addition to written material, the parties attended a directions hearing on 27 August 2020, a hearing on 22 October 2020 and 3 December 2020. Mr Vassallo’s submission that costs regarding the “failed objection as to the jurisdiction of the FWC to deal with a s 603 application”16are not appropriate to be claimed is misconceived and incorrect. The costs order made in the 2021 costs decision is for costs incurred by Easitag in responding to the s 603 application from 24 August 2021 onwards.
[18] I will deal firstly with the items claimed for professional costs in Part A of the Bill of Costs apart from the claim for general care and skill:
• Items 1,2,3,4 and 5 are for costs incurred prior to 24 August 2020 and will not be awarded. This results in a claimed sum of $110.00 not being allowed.
• Items 6-15, 17, 19-30, 32-36 and 38-42 have been charged for items that appear in Schedule 3.1 of the Regulations. As noted above, the quantum for each of these items reflects that which is outlined in the Schedule. On that basis, I consider they are costs reasonably incurred. They total $2,119.00.
• Item 16: This is a claim for $300.00 for perusing Mr Vassallo’s submissions dated 15 September 2020, on the basis that they were in excess of 30 folios. I have noted that if Schedule 3.1 applied, Item 601(a)(ii) allows $4.00 per folio and under Item 601(b), the Commission has a discretion for a document with 30 or more folios. Further, Regulation 6.06(4) of the Regulations outlines that a folio equates to 72 words and suggests there are generally 3 folios per page. Having regard to these factors, and noting that these submissions totalled nearly 5,000 words and 13 pages, I consider an allowance of $200.00 represents, in all the circumstances, a cost reasonably incurred.
• Item 18: this is a claim for $100.00 for scanning the annexures to Mr Vassallo’s witness statement, which are said to have totalled 975 pages. Noting that if Schedule 3.1 applied and that Item 602 allows $6.00 per page for scanning documents, I consider the $100.00 claimed is a cost reasonably incurred.
• Item 31: A claim for $200.00 is claimed for scanning Mr Vassallo’s exhibits JV-15 to JV-24 dated 5 November 2020, which are said to have totalled 504 pages. Noting that if Schedule 3.1 applied and that Item 602 allows $6.00 per page for scanning documents, I consider the $200.00 claimed is a cost reasonably incurred.
• Item 37: A claim for $200.00 is claimed for the perusal of the s 603 decision on the basis that it was in excess of 30 folios. Again, I have noted that if Schedule 3.1 applied, Item 601(a)(ii) allows $4.00 per folio and under Item 601(b), the Commission has a discretion for a document with 30 or more folios. Further, Regulation 6.06(4) of the Regulations outlines that a folio equates to 72 words and suggests there are generally 3 folios per page. Having regard to these factors, and noting that the s 603 decision totalled approximately 7,600 words and 15 pages I consider the $200.00 claimed is, in all the circumstances, a cost reasonably incurred.
[19] In the second of the two items numbered 42, the claim totals $6,000.00 for general care and skill. I have noted that if Schedule 3.1 applied, Item 1201 provides:
“If the case or circumstances warrant it, an allowance may be claimed under this item in addition to any other item that appears in this Schedule, for general care and conduct in relation to the following:
a) the complexity of the matter and the difficulty and novelty of questions raised;
b) the importance of the matter to the party and the amount involved;
c) the skill, labour, specialised knowledge and responsibility involved in the matter on the part of the solicitor;
d) the number and importance of the documents prepared or perused, without regard to length;
e) the time taken by the solicitor;
f) research and consideration of questions of law and fact.
The FWC may allow an amount the FWC considers reasonable in the circumstances of the case.” (my underlining)
[20] I consider it is of assistance to have regard to what is outlined in Item 1201 of Schedule 3.1 and to assess what would be a reasonable allowance in the circumstances of this case. I am satisfied responding to Mr Vassallo’s application and in particular the manner in which it was presented and argued warrants an award for costs for general care and skill. I have however noted that Easitag also briefed Counsel and as outlined below, I am satisfied that the fees of Counsel should be allowed in all but one respect. Balanced against this is that while I determined that costs should be awarded on an indemnity basis, Easitag has based its claim for costs on the items contained within Schedule 3.1 of the Regulations and has only claimed the rates outlined in the Schedule. While $6,000.00 has been claimed, I have concluded having regard to the circumstances of this case that the sum of $2,000.00 for general care and skill of the solicitors is reasonable.
[21] I have therefore assessed professional costs in Part A of the Bill of Costs on an indemnity basis as totalling $4,819.00.
[22] The disbursements claimed are in Part B of the Bill of Costs. They relate to the fees of Ms Simone Bingham of Counsel. Itemised invoices from Counsel have been provided. I have considered the Federal Court’s National Guide to Counsel Fees (the Guide). I observe the Guide outlines amounts which may be applied by taxing officers of the Court in taxing party/party costs and that it provides a range for each of the fees that might be allowed for each particular item for both Junior and Senior Counsel. I also observe that as Ms Bingham was admitted to practice in 1994 and signed the Roll of Counsel in November 2003, she would appropriately be regarded as a ‘Senior Junior’. I consider that if the Guide was to apply (i.e. if I had determined that costs should be awarded on a party/party basis), fees for each item would be assessable at the upper end of the range. However, as I have determined to award Easitag costs against Mr Vassallo on an indemnity basis, I am not limited to the amounts in the Guide and although the amounts outlined in Part B of the Bill of Costs are expressed as being exclusive of GST, I consider it appropriate that the costs awarded for disbursements should reflect the amount of the fee that was payable by Easitag, which in this case was inclusive of GST.
[23] I must therefore assess whether Counsel’s fees were reasonably incurred amounts, noting the fees have been incurred at an hourly rate of $420.00 inclusive of GST and that the Guide outlines a range for hourly fees of Junior Counsel from $265.00 - $530.00 per hour:
1. $1,528.28 exclusive of GST from an Invoice dated 27 August 2020, itemised as follows:
a) 18 August 2020: Fees attributable to 30 minutes for reading an email from the instructing solicitor and a telephone attendance on the instructing solicitor. Having had regard to the Guide, which allows for fees to be charged for other attendances ‘not otherwise provided for’, I consider the fee of $210.00 inclusive of GST was reasonably incurred.
b) 19 August 2020: Fees attributable to 1 hour 30 minutes for reviewing the s 603 application and settling correspondence to Mr Vassallo’s then solicitors. Having had regard to the Guide, which allows for fees to be charged for settling documents and other attendances ‘not otherwise provided for’, I consider the fee of $630.00 inclusive of GST was reasonably incurred.
c) Preparation and Appearance at the Mention 27 August 2020: Having had regard to the Guide, which allows for fees to be charged on an hourly basis for both the preparation for and attendance at a Directions hearing, I consider the fee of $840.00 inclusive of GST attributable to 2 hours work was reasonably incurred.
I am therefore satisfied that Counsel’s fees of $1,680.00 inclusive of GST were reasonably incurred.
2. $6,109.09 exclusive of GST for 3 items from an Invoice dated 6 October 2020, itemised as follows:
a) 8 September 2020 and 9 September 2020: Fees attributable to 15 hours work for drawing and settling the submissions and a conference with the instructing solicitors are claimed. Having had regard to the Guide, which allows for fees to be charged for written submissions and conferences, I consider a fee representing 9 hours work would reflect a fee reasonably incurred and therefore award $3,780.00 inclusive of GST.
b) 30 September 2020: Fees attributable to 1 hour for reviewing submissions in reply. Having had regard to the Guide, which allows for fees to be charged for other attendances ‘not otherwise provided for’, I consider the fee of $420.00 inclusive of GST was reasonably incurred.
I am therefore satisfied that Counsel’s fees of $4,200.00 inclusive of GST were reasonably incurred.
3. $763.64 exclusive of GST from an Invoice dated 2 November 2020, for the preparation for and appearance at the on Hearing 22 October 2020. Having had regard to the Guide, which allows for fees to be charged for other appearances at hearings by Junior Counsel to be allowed between the range of $90.00 - $4,200.00, I consider the fee of $840.00 inclusive of GST was reasonably incurred.
4. $2,088.00 exclusive of GST for 2 items from an Invoice dated 18 January 2021, itemised as follows:
a) Fees attributable to 1 hour 30 minutes work on 11 November 2020 for settling the s 603 Submissions. Having had regard to the Guide, which allows for fees to be charged for settling documents, I consider the fee of $210.00 inclusive of GST was reasonably incurred.
b) Preparation and appearance at the hearing 3 December 2020. Having had regard to the Guide, which allows for fees to be charged for other appearances at hearings by Junior Counsel to be allowed between the range of $90.00 - $4,200.00, I consider the fee of $1,890.00 inclusive of GST was reasonably incurred.
I am therefore satisfied that Counsel’s fees of $2,100.00 inclusive of GST were reasonably incurred.
[24] I have therefore assessed disbursements comprising Counsel’s fees on an indemnity basis as totalling $8,820.00 inclusive of GST.
[25] The total amount that I will order Mr Vassallo to pay in costs resulting from his application is $13,639.00 ($4,819.00 professional costs outlined in Part A of the Bill of Costs + $8,820.00 disbursements for Counsel’s fees). I consider this to be an appropriate amount to order in the exercise of my discretion under s 611 of the Act on an indemnity basis. An order giving effect to this decision will be issued separately.
COMMISSIONER
Printed by authority of the Commonwealth Government Printer
<PR733821>
Attachment A
1 [2021] FWC 3479
2 [2021] FWCFB 3974 at [2]
3 [2021] FWC 132
4 [2021] FWCFB 1554
5 [2021] FWCFB 3974 at [20]
6 PR732106
7 [2021] FWC 3913
8 Ibid [8]
9 Ibid [48]
10 Applicant’s Response to Itemised Bill of Costs, 12 August 2021
11 [2016] FWCFB 8162
12 Ibid [14] – [15]
13 [2021] FWCFB 3974 at [17]
14 Note, there are two items listed as Item 42.
15 Ibid [20]
16 Applicant’s Response to Itemised Bill of Costs, 12 August 2021.
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